Mohamed al-Fayed has issued a challenge to the Duke of Edinburgh during the second day of his cross examination in the libel trial brought against him by Neil Hamilton.

Mr al-Fayed called on Prince Philip to sue him over his allegations that the Duke had "masterminded" a conspiracy to kill the Princess of Wales and his son Dodi.

The events surrounding the death of Diana Princess of Wales dominated proceedings at the High Court on Monday where Neil Hamilton is suing the Harrods boss for libel.

Mr Hamilton says his career was ruined when Mr al-Fayed claimed in a Channel 4 programme that the former Tory MP took cash for asking parliamentary questions. He has always denied the allegations.

Seeking to establish a pattern of persistent dishonesty, Mr Hamilton's lawyer, Desmond Browne QC, asked Mr al-Fayed about his controversial theory that the deaths of Diana and his son, Dodi, was caused by the British security services and his claims that Diana and Dodi planned to marry.

But Mr al-Fayed objected to a lawyer questioning him on his reaction following the deaths of Diana and Dodi.

The Egyptian-born businessman stood by his earlier claim that Prince Philip was responsible for the fatal 1997 car crash.

Mr Browne QC, asked Mr al-Fayed about his involvement in an ITV programme suggesting the Paris crash killing Princess Diana and Dodi had been the result of a conspiracy.

The Diana and Dodi shrine at Harrods

"I have told you before I am a father who has lost his son and I have the right to do anything to find out how I lost my son and, please, I have asked you several times not to capitalise on my grief," replied the Harrods supremo.

Mr al-Fayed appealed to the judge, Mr Justice Morland, to tell the lawyer to stop asking him questions about the Paris crash.

But Mr Browne told him: "Mr al-Fayed, I am not capitalising on your grief. I am asking you about matters you have made public yourself."

The barrister had asked Mr Al Fayed if he had known when he was interviewed for the ITV programme that it was "likely to suggest that the crash had been a conspiracy and not an accident".

Mr Browne suggested: "You believed at this time, did you not, that the crash had not been an accident, but the result of a conspiracy?"

He replied: "I have the right to believe everything. I have the right to find out how my son has been killed."

Mr Browne then said Mr al-Fayed had accused the Duke of Edinburgh of masterminding the crash because of his "German blood and Nazi views".

Mr al-Fayed said: "I have the right to say what I feel and what I believe. I have a lot of support, I receive millions of letters."

Marriage plans

Mr Browne asked Mr al-Fayed about an August 1998 article in The Sunday Mirror in which he said there was no doubt Dodi and Diana would have married.

The barrister also quizzed Mr al-Fayed over allegations in The Sun newspaper, which appeared two days later, which said his talk of a marriage had been lies.

Mr al-Fayed said simply: "I am the father. I know exactly what my son is doing. Everyone else - it's just jealousy, envy."

When asked why he did not sue for libel over the article, Mr al-Fayed said: "I don't need to sue every newspaper because on a daily basis I am insulted by the establishment."

The Harrods boss integrity was further probed when he was asked why he had backed out of his attempt to sue The Observer newspaper when it claimed he did not use his own resources to buy Harrods.

Mr Browne said: "I'm suggesting that you used litigation and the threat of litigation to gag the press and try to conceal the truth."

Reprimanded by judge

During the day's proceedings Mr al-Fayed made references to the recent revelations about Lord Archer and to the imprisonment of the former Tory MP Jonathan Aitken.

On both occasions he was reprimanded by the judge.

Mr al-Fayed accused the former Home Secretary, Michael Howard, of receiving a £1m bribe from rival tycoon Tiny Rowland to obstruct his purchase of Harrods.

Mr Browne suggested the allegations about Mr Howard was as untrue as Mr al-Fayed's comments about the Duke of Edinburgh.

Mr al-Fayed said: "I say about the tragedy what I believed. I believe because I'm so close. I was so close to Princess Diana and I know what happened to her in the years of her marriage".